| Company | Bear Stearns & Company (second package) |
| Date Announced | 8/27/1997 |
| Site | 383 Madison Ave at Vanderbilt, near Grand Central Station |
| Total Subsidy | $75 million |
|
$30 million |
| Promised Job Creation | 13,300 |
| Promised Job Retention | 5,700 |
| Length of Contract | 50 years |
| Competing Sites | none |
| Conditions | $45 million in sales tax exemptions for keeping 5,800 employees in the city for the next 50 years, and up to $30 million more in sales tax breaks if the company creates at least 13,300 new jobs within 50 years. More than half of these jobs had already been "saved" in 1991. The 1991 tax benefit package from the Dinkins administration covered the back office staff at MetroTech Center and the headquarters staff at 245 Park Avenue through 2006. |
| Notes | The
Giuliani administration granted global investment bank Bear Stearns up to
$75 million in sales tax exemptions for its new world HQ, a 1.1 million
square-foot tower on land near Grand Central Terminal. The owners of the
parcel, the al-Babtain family of Saudi Arabia, doubled the $55 million
price that Bear Stearns originally agreed to in 1995. That means that most
of the $75 million subsidy is going to offset the costs of real estate
speculation. James E. Cayne, chief executive of Bear Stearns, said that
during the company's three year search for new space, it had never
threatened to leave the city. At the same time Bear Stearns was accepting the $75 million in tax breaks, "the five bosses of Bear Stearns were being given personal bonuses that came to $87.5 million in cash and stock" notes Jim Dwyer in the Daily News (12/16/97). In April 2001, Bear Stearns announced that 400 employess would lose their jobs. |
| Corporate Notes | |
| Critics | Thomas Carroll, president of Change-NY said, "A company with the earnings of Bear Stearns doesn’t need the helping hand of the taxpayers. The problem with this approach to economic development is that it always focuses on the companies with the biggest brand names and best political connections. The small and medium-sized companies, which are responsible for more job growth, are often left in the dust." Charles V. Bagli, New York Times, 8/28/97. |
| A
note on sources -- or why many of these profiles appear incomplete.
They are. Good Jobs New York compiled the numbers in these profiles from
press releases and news accounts of the deals. Unfortunately, more
detailed information on these subsidies is very difficult to obtain --
even though it should be readily available to the public. In many cases,
neither the company nor the city nor state released certain information,
particularly the terms of the agreement, i.e., the conditions which the
company had to meet in order to receive the subsidy. It should also be
noted that the value of the subsidy may not end up being equal to the
value estimated at the time of the agreement. And it should not be assumed
that the actual number of jobs retained and created will be the same as
the numbers predicted.
Because the public deserves easy access to information about how taxpayer dollars are being spent, Good Jobs New York will update these profiles as we uncover more information. Good Jobs New York - May 25, 2001 |
|